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Minnesota Attorney General Lori Swanson

Jim Mone, Associated Press

Hospitals tread fine line in pressing patients for money

  • Article by: MAURA LERNER
  • Star Tribune
  • April 26, 2012 - 10:41 AM

The consultants at Accretive Health readily admitted that a "typical hospital" doesn't do financial counseling in the emergency room.

But, they boasted, they had found a way to get 15 percent of ER patients to pay upfront. They called it the "Accretive Secret Sauce."

Accretive's secret was roundly attacked in a report this week by Minnesota Attorney General Lori Swanson. But in Minnesota hospitals, it's no longer unusual to approach patients in advance about paying their bills, according to hospital executives.

The difficult question is where to draw the line.

"It's very sensitive," admits Lawrence Massa, president of the Minnesota Hospital Association. "I think the standard is changing -- and that's not something that the public in America is used to."

Swanson's report on Accretive's tactics, released Tuesday, is shining a spotlight on how far hospitals are willing to go to collect the patient's share of the bill in tight economic times.

Massa said hospitals are being more assertive about calling patients in advance to talk about money -- including co-pays and deductibles. But emergency rooms, he said, are a different story. "Pressuring people when they're at a moment of distress is probably not a good idea. The care needs of the patient need to be taken care of first."

Swanson accused Accretive, an Illinois consulting firm hired by Fairview, of using aggressive collection tactics in many settings, from cancer wards to labor and delivery rooms. In some cases, according to her report, ER staff members made patients wait while they conducted "financial consultations" about payments -- an apparent violation of federal law.

Fairview officials were not available for interviews Wednesday, but they said this week that they are cooperating with Swanson and have ended their revenue-management contract with Accretive. Accretive officials did not respond to a request for comment.

Health systems comment

The attorney general's report touched a nerve in Minnesota medical circles.

"To be clear, Mayo Clinic would never ask for upfront payments for patients being seen in the emergency room," the clinic said Wednesday in a prepared statement responding to questions.

"In some cases Mayo Clinic does require upfront payments for non-emergency hospital procedures. We work with patients, including providing financial counseling, as they enter our system."

At Allina, hospital officials issued a similar statement. In non-emergency situations, they said, "we ask for and accept payment if the patient is willing." If the patient can't pay, "we offer a self-addressed stamped envelope." But the emergency rooms "do NOT ask for upfront payments before treating patients," Allina said.

HealthEast asks for no payments at "point of service," said Mike Nass, chief financial officer.

At the same time, Nass said, hospitals are "very far behind" other industries in "collecting for the products and services that we provide."

That has turned out to be a growing problem, especially now that many people have high-deductible insurance policies that can leave them with thousands of dollars as their share of the medical bill.

"This is not a new phenomenon," said Keith Hearle, a hospital consultant in Alexandria, Va. "If you don't collect something right upfront, every day that goes by after someone is discharged, it's harder to collect on an account."

In most cases, hospitals say they're willing to work out payment plans with patients, or help them get charity care if they qualify.

"You want to find the right balance between collecting every nickel, but also honoring the charity-care policy," said Hearle.

The Accretive case, Massa said, "points out the difficulties that hospitals have trying to keep that balance."

At the same time, he said, there's nothing wrong with asking patients how they plan to handle their financial responsibilities.

"There's always a balance between the charitable mission of the hospitals to provide care," he said, and making sure "that people who have the means to pay will pay their bills."

Staff writer Jackie Crosby contributed to this report. Maura Lerner • 612-673-7384

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